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Elegant Hotels Group PLC Q&A: Acquisition of Treasure Beach Hotel in Barbados (LON:EHG)

Elegant Hotels Group PLC (LON:EHG) Chief Executive Officer Sunil Chatrani caught up with DirectorsTalk for an exclusive interview to discuss the acquisition of Treasure Beach Hotel in Barbados, their management contracts and agreements in Antigua and St Lucia and the Group’s expansion strategy

 

Q1: Now, you’ve just announced the acquisition of Treasure Beach Hotel in Barbados, what was the criteria you used when deciding that Treasure Beach was an attractive acquisition target for Elegant Hotels?

A1: Treasure Beach if a good fit for us, we are very familiar with the area and already operate in the adjoining property, Tamarind which is in turn situated next to our restaurant Daphne’s and our couples-only property, The House. Not only does Treasure Beach makes sense geographically but it is also a good fit with our strategy of refurbishing, reposition and replacing our properties using our unique experience of operating in the Caribbean market place.

 

Q2: So, what are its strengths as a property and how does it fit in with your existing portfolio? What will the acquisition mean for your share of the quality leisure room tourist stock in Barbados?

A2: Treasure Beach is a great property in a fantastic location, it benefits from 35 rooms and occupies about 1.1 acres of land and its amenities include swimming pool, spa and restaurant. Elegant Hotels now owns a continuous 300 metres stretch over the prestigious west coast of Barbados, from Treasure Beach to the House, including Tamarind and Daphne’s in between, the guests of Treasure Beach will also be able to make use of the facilities of the neighbouring property, Tamarind hotel, as well as our restaurant Daphne’s. We also operate the Taste of Elegance Dine Around Programme allowing our guests to dine at any one of our other hotels in Barbados. As the largest independent operator in Barbados, we are uniquely placed to operate Treasure Beach and optimise its potential as an adults-only European Plan hotel. Following the acquisition, the Group’s portfolio will comprise of circa 600 rooms, making it twice as large by number as its closest competitor in the Barbados leisure market.

 

Q3: You last talked to us about management contract strategy, last month you announced a sales and marketing agreement with The Landings Resort and Spa in St Lucia. Can you explain a bit more about what this involves and how it’s progressing?

A3: The Group is progressing well, at the time of IPO we made it clear that we wanted to expand in both Antigua and St Lucia. This arrangement, the management contract with the Hodges Bay Resort in Antigua provides an excellent opportunity for the Group to expand beyond Barbados as it requires far less capital investment than full ownership. The agreement also allows us to spread the Elegant Hotels brand further across the Caribbean and enables us to gain experience operating on other islands and acts as a platform for further growth.

 

Q4: Can you give us a bit more detail on Elegant Hotels Group’s expansion strategy, both in Barbados and further afield into the wider Caribbean market?

A4: Our expansion strategy remains pretty much the same as we outlined at our IPO two years ago. We focus on under-performing hotels that can be refurbished, repositioned and replaced, both in Barbados and throughout the Caribbean. Our unrivalled experienced as an independent operator in the region means that we are well placed to continue competing and gaining market share as we develop our operations in Antigua and St Lucia, we will benefit from having platforms for further expansion in the Caribbean.